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Ligand (LGND) Up 3% on Raised '23 View, Beats on Q1 Earnings
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Shares of Ligand Pharmaceuticals Incorporated (LGND - Free Report) rose 3.4% on Friday in response to the company’s increased 2023 guidance when it announced its first-quarter 2023 results. This is the second time the company raised the full-year guidance for 2023 this year.
In the year so far, shares of Ligand have risen 18.8% against the industry’s 4.9% fall.
Image Source: Zacks Investment Research
Q1 Earnings & Sales Beat Estimates
Ligand reported adjusted diluted earnings of $2.28 per share in first-quarter 2023 from continuing operations, beating the Zacks Consensus Estimate and our estimate of $1.03 and 92 cents, respectively. The company reported adjusted earnings of 79 cents in the year-ago quarter.
Total revenues of $44.0 million were up 20.4% from the year-ago quarter’s levels. The upside can be attributed to the increased royalties from sale of drugs developed using the company’s proprietary platforms. Revenues beat the Zacks Consensus Estimate of $39.0 million. It is worth mentioning that the reported figure also beat our estimate of $40.5 million.
Quarter in Detail
Royalty revenues were up 27.7% year over year to $17.2 million in the first quarter. The upside was mainly driven by increased Kyprolis royalties and growth in sales of drugs developed using the company’s Pelican platform.
Total Captisol sales were down 12.2% year over year to $10.6 million in the reported quarter. Ligand reports its Captisol sales separately for core assets and COVID-related sales. Core Captisol sales rose 70.6% to $10.6 million, due to favorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 47.8% year over year to $16.2 million in the first quarter, owing to the favorable timing of partner milestone events.
Research and development (R&D) expenses fell 27.4% to $6.7 million, due to a decline in headcount-related expenses. General and administrative (G&A) expense were down 9% to $10.9 million, due to lower legal expenses in connection with the spinoff of OmniAb (OABI - Free Report) .
Last November, Ligand completed the separation of the OmniAb business to focus on its Captisol business. Management completed the distribution of 100% of its ownership of OmniAb to its shareholders in a tax-free distribution. Shares of OmniAb started trading on the NASDAQ on Nov 2, 2022.
Cash, cash equivalents and short-term investments amounted to $282.7 million as of Mar 31, 2023, compared with $211.9 million at the end of the previous quarter.
2023 Guidance
Ligand raised its guidance for 2023. Management expects 2023 royalty revenues in the range of $78-$82 million, up from the previously-expected range of $74-$78 million. Captisol sales and contract revenue expectations were unchanged at $21-$25 million, respectively. The company also increased its expectation for adjusted diluted EPS to $4.60-$4.75, which was expected in the range of $3.30-$3.45. The rise in guidance is due to gains from the sale of Viking Therapeutics (VKTX - Free Report) stock and increased revenue guidance.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19 related products are received.
Key Partnered Pipeline Progress
In February, Ligand’s partner Travere Therapeutics (TVTX - Free Report) announced that the FDA granted accelerated approval to its IgA nephropathy (IgAN) treatment candidate, sparsentan. The drug is being marketed under the brand name Filspari and is the first and only dual endothelin angiotensin receptor antagonist in the development for rare kidney diseases. Travere’s sparsentan is also under review in the European Union for the treatment of IgAN in Europe and a decision by the EMA is expected in second-half 2023. Ligand had out-licensed the global rights for sparsentan to Travere Therapeutics in 2012.
Earlier this month, Travere reported top-line results from the pivotal phase III DUPLEX study of sparsentan in focal segmental glomerulosclerosis (FSGS) did not achieve the primary endpoint. Travere intends to discuss these results with the FDA to explore a potential path forward for sparsentan as a treatment for FSGS in the United States and Europe.
This January, Ligand’s partner Viking Therapeutics announced that it completed enrolment in the phase IIb VOYAGE study evaluating VK-2809 in patients with biopsy-confirmed non-alcoholic steatohepatitis (NASH). Data from the Viking Therapeutics-partnered study is expected in first-half 2023. VK-2809 has been developed using Ligand’s HepDirect technology platform. During the quarter, the company also sold 3.2 million shares of Viking stock during the quarter resulting in $43 million of net proceeds. As of March 2023-end, Ligand owned 3.6 million shares of Viking Therapeutics’ stock.
In March, Ligand’s partner Novartis announced that the FDA had approved a liquid form of Tafinlar (dabrafenib) + Mekinist (trametinib) for treating pediatric patients aged one year and older with low-grade glioma (LGG) with a BRAF V600E mutation and who require systemic therapy. This is the first approval of an oral Captisol-enabled product. Novartis had entered into agreement with Ligand in 2016 to develop an oral formulation of Mekinist for the given indication.
Image: Bigstock
Ligand (LGND) Up 3% on Raised '23 View, Beats on Q1 Earnings
Shares of Ligand Pharmaceuticals Incorporated (LGND - Free Report) rose 3.4% on Friday in response to the company’s increased 2023 guidance when it announced its first-quarter 2023 results. This is the second time the company raised the full-year guidance for 2023 this year.
In the year so far, shares of Ligand have risen 18.8% against the industry’s 4.9% fall.
Image Source: Zacks Investment Research
Q1 Earnings & Sales Beat Estimates
Ligand reported adjusted diluted earnings of $2.28 per share in first-quarter 2023 from continuing operations, beating the Zacks Consensus Estimate and our estimate of $1.03 and 92 cents, respectively. The company reported adjusted earnings of 79 cents in the year-ago quarter.
Total revenues of $44.0 million were up 20.4% from the year-ago quarter’s levels. The upside can be attributed to the increased royalties from sale of drugs developed using the company’s proprietary platforms. Revenues beat the Zacks Consensus Estimate of $39.0 million. It is worth mentioning that the reported figure also beat our estimate of $40.5 million.
Quarter in Detail
Royalty revenues were up 27.7% year over year to $17.2 million in the first quarter. The upside was mainly driven by increased Kyprolis royalties and growth in sales of drugs developed using the company’s Pelican platform.
Total Captisol sales were down 12.2% year over year to $10.6 million in the reported quarter. Ligand reports its Captisol sales separately for core assets and COVID-related sales. Core Captisol sales rose 70.6% to $10.6 million, due to favorable timing of customer orders. During the quarter, the company did not record any Captisol sales related to COVID-19.
Contract revenues were down 47.8% year over year to $16.2 million in the first quarter, owing to the favorable timing of partner milestone events.
Research and development (R&D) expenses fell 27.4% to $6.7 million, due to a decline in headcount-related expenses. General and administrative (G&A) expense were down 9% to $10.9 million, due to lower legal expenses in connection with the spinoff of OmniAb (OABI - Free Report) .
Last November, Ligand completed the separation of the OmniAb business to focus on its Captisol business. Management completed the distribution of 100% of its ownership of OmniAb to its shareholders in a tax-free distribution. Shares of OmniAb started trading on the NASDAQ on Nov 2, 2022.
Cash, cash equivalents and short-term investments amounted to $282.7 million as of Mar 31, 2023, compared with $211.9 million at the end of the previous quarter.
2023 Guidance
Ligand raised its guidance for 2023. Management expects 2023 royalty revenues in the range of $78-$82 million, up from the previously-expected range of $74-$78 million. Captisol sales and contract revenue expectations were unchanged at $21-$25 million, respectively. The company also increased its expectation for adjusted diluted EPS to $4.60-$4.75, which was expected in the range of $3.30-$3.45. The rise in guidance is due to gains from the sale of Viking Therapeutics (VKTX - Free Report) stock and increased revenue guidance.
This guidance excludes Captisol sales related to COVID-19 and its impact on gross profit. Management will update investors as and when orders for COVID-19 related products are received.
Key Partnered Pipeline Progress
In February, Ligand’s partner Travere Therapeutics (TVTX - Free Report) announced that the FDA granted accelerated approval to its IgA nephropathy (IgAN) treatment candidate, sparsentan. The drug is being marketed under the brand name Filspari and is the first and only dual endothelin angiotensin receptor antagonist in the development for rare kidney diseases. Travere’s sparsentan is also under review in the European Union for the treatment of IgAN in Europe and a decision by the EMA is expected in second-half 2023. Ligand had out-licensed the global rights for sparsentan to Travere Therapeutics in 2012.
Earlier this month, Travere reported top-line results from the pivotal phase III DUPLEX study of sparsentan in focal segmental glomerulosclerosis (FSGS) did not achieve the primary endpoint. Travere intends to discuss these results with the FDA to explore a potential path forward for sparsentan as a treatment for FSGS in the United States and Europe.
This January, Ligand’s partner Viking Therapeutics announced that it completed enrolment in the phase IIb VOYAGE study evaluating VK-2809 in patients with biopsy-confirmed non-alcoholic steatohepatitis (NASH). Data from the Viking Therapeutics-partnered study is expected in first-half 2023. VK-2809 has been developed using Ligand’s HepDirect technology platform. During the quarter, the company also sold 3.2 million shares of Viking stock during the quarter resulting in $43 million of net proceeds. As of March 2023-end, Ligand owned 3.6 million shares of Viking Therapeutics’ stock.
In March, Ligand’s partner Novartis announced that the FDA had approved a liquid form of Tafinlar (dabrafenib) + Mekinist (trametinib) for treating pediatric patients aged one year and older with low-grade glioma (LGG) with a BRAF V600E mutation and who require systemic therapy. This is the first approval of an oral Captisol-enabled product. Novartis had entered into agreement with Ligand in 2016 to develop an oral formulation of Mekinist for the given indication.
Ligand Pharmaceuticals Incorporated Price
Ligand Pharmaceuticals Incorporated price | Ligand Pharmaceuticals Incorporated Quote
Zacks Rank
Ligand Pharmaceuticals currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.